Analysts from Pricewaterhouse Coopers (PWC) expect funds raised via A-share IPO’s in China to rise to a decade-long high in 2021.
“The A-share IPO financing amount could rise to another 10-year high [in 2021]” said Liang Weijian (梁伟坚), partner at PWC China, at a press conference held in Beijing on 4 January for the release of 2020 IPO data.
“We expect the number of IPO’s to reach 430 – 490, raising funds of between 450 billion – 480 billion yuan (approx. USD$75 billion).”
Despite the impacts of the COVID-19 pandemic China saw a total of 395 A-share IPO’s in 2020, for a YoY rise of 97%. These IPO’s raised 471.9 billion yuan, for a YoY increase of 86% and the highest level since 2011.
PWC believes the launch of the A-share registration system in China has played a key role in accelerating the pace of A-share IPO’s.
“While the Novel Coronavirus pandemic has had an impact on the global economy, because China’s domestic economy rapidly and steadily recovered, and because of the success of stage-based registration system reforms, A-share IPO activity was not only unaffected, but instead displayed a positive trend of activity,” said Liang.
“Looking to 2021, A-share IPO’s will continue to maintain a positive development momentum, benefiting from the Dual Circulation policy and the central government’s 14th Five Year Plan.”
PWC’s IPO Projections for 2021
|Board||No. of IPO’s||Fund-raising amount (billion yuan)||No. of IPO’s in 2020||Fund-raising amount in 2020 (billion yuan)|
|Shanghai mainboard||100 – 110||100 – 110||89||122.8|
|Shanghai STAR board||150 – 170||200 – 210||145||222.6|
|Shenzhen SME board||55 – 60||40||54||37.2|
|Shenzhen ChiNext board||125 – 150||110 – 120||107||89.3|
|Total||430 – 490||450 – 480||395||471.9|
As of the final trading day of 2020 China was host to 4142 A-share companies, of which 1795 were listed in Shanghai and 2347 listed in Shenzhen.
China’s ten largest A-share IPO’s in 2020 raised a total of 141.7 billion yuan, accounting for 30% of the total fund-raising amount.
Semiconductor Manufacturing International Corporation (SMIC) staged the biggest IPO in 2020, raising 53.23 billion yuan, and accounting for 37.54% of the the fund-raising sum for China’s ten biggest IPO’s that year.